{"id":70370,"date":"2026-03-29T16:11:47","date_gmt":"2026-03-29T16:11:47","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/economist-steve-hanke-says-us-is-losing-iran-war-and-is-financially-insolvent-featured-bitcoin-news\/"},"modified":"2026-03-29T16:11:47","modified_gmt":"2026-03-29T16:11:47","slug":"economist-steve-hanke-says-us-is-losing-iran-war-and-is-financially-insolvent-featured-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/economist-steve-hanke-says-us-is-losing-iran-war-and-is-financially-insolvent-featured-bitcoin-news\/","title":{"rendered":"Economist Steve Hanke Says US Is Losing Iran War and Is Financially Insolvent \u2013 Featured Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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Steve Hanke: Bond Vigilantes Are Turning on Trump as War Costs Mount, and Deficits Expand<\/h2>\n

Steve Hanke<\/a>, professor of applied economics at Johns Hopkins University and a regular contributor to Fortune magazine, appeared on The David Lin Report<\/a> this week, delivering a point-by-point breakdown of why the U.S. position in the Iran conflict is weaker than officials acknowledge and why the country\u2019s balance sheet confirms what markets are starting to price in.<\/p>\n

The war, now ongoing, has functionally closed the Strait of Hormuz<\/a> to hostile nations. Throughput from the Strait has fallen roughly 95%, according to Hanke, who frames Iran\u2019s position not as a nation under siege but as one quietly winning a war of attrition. Iran has called up over a million troops and controls the chokepoint on which the global economy depends.<\/p>\n

Iran is winning the war, Hanke told Lin. \u201cThey are in control of the Strait of Hormuz,\u201d Hanke insisted. \u201cIt looks to me like they are going to continue controlling the Strait, and in that sense, they have a lot of leverage<\/span> over the West. They have Trump completely in a corner because the Western economies are suffering tremendous damage already.\u201d<\/p>\n

Iran\u2019s oil exports have actually increased<\/a> since the war began, Hanke explained, citing reports from contacts inside the country. Iranian crude is moving through tankers exiting the Strait, selling at higher prices with lower discounts than before hostilities. The Iranian rial has appreciated 6%<\/a> since the war started. Inflation<\/a>, which Hanke tracks independently, remains elevated at 67% annually but has come down from over 80%.<\/p>\n

Physical oil markets in Asia are trading well above futures prices, a gap Hanke says will close as paper markets catch up to supply reality. He noted that the Philippines has declared a national energy emergency. New Zealand is making weekly cash payments to roughly 150,000 families to help cover fuel costs. The interview touched upon how Taiwan faces shortages of helium, a chip manufacturing input sourced from the Gulf, and is now sourcing it from Russia<\/a>.<\/p>\n

Russia, Hanke noted, is the war\u2019s clearest beneficiary. It produces oil, fertilizer, and helium, three commodities bottled up in the Gulf, and is positioned to exchange sanctions relief for market access.<\/p>\n

Hanke dismissed the Mossad\u2019s decapitation strategy as a strategic failure. Intelligence assessments predicted the Iranian regime would collapse within days of the supreme leader\u2019s assassination. It didn\u2019t happen. \u201cThis goes in the failure book,\u201d Hanke said.<\/p>\n

The Johns Hopkins University economist added:<\/p>\n

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\u201cThe strategy and the objective of Israel and the United States have failed already.\u201d<\/p>\n<\/blockquote>\n

He also challenged the claim that the U.S. is insulated from oil price<\/a> pain because it is a net energy exporter. While the U.S. exports more energy products overall, it remains a net importer of crude oil. \u201cForget the fact that we\u2019re somehow insulated from world prices in oil,\u201d Hanke said. \u201cThis is another joke coming out of Washington.\u201d<\/p>\n

The balance sheet picture is no cleaner. Hanke co-authored a piece in Fortune with former U.S. Comptroller General Dave Walker, drawing directly from the U.S. government\u2019s own consolidated financial statements. As of September 30, 2025, the federal government holds roughly $6 trillion in assets against nearly $48 trillion in on-balance-sheet liabilities. Add Social Security and Medicare \u2014 both off-balance-sheet \u2014 and total liabilities climb to approximately $136 trillion.<\/p>\n

\u201cYou have a little over six trillion in assets and almost 48 trillion in liabilities,\u201d Hanke told Lin during the discussion.<\/p>\n

He continued:<\/p>\n

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\u201cThat means you\u2019re insolvent. It\u2019s a complete catastrophe, and the numbers are deteriorating very rapidly.\u201d<\/p>\n<\/blockquote>\n

The bond market<\/a> has reacted. Rising 10-year Treasury yields reflect investor concern over deficit expansion, and Hanke notes the relationship between higher yields and lower gold<\/a> prices, not because gold<\/a>\u2019s long-term case has changed, but because rising rates increase the opportunity cost of holding a non-yielding asset. He maintains his gold<\/a> price target range of $6,000 to $7,000 for the current cycle.<\/p>\n

Hanke\u2019s proposed fixes: a congressional commission to address existing liabilities, and a constitutional amendment modeled on Switzerland\u2019s 2001 debt brake, one that would cap spending growth at the rate of real GDP expansion and require a balanced fiscal position over the business cycle. Whether Congress<\/a> acts on either is, as Hanke put it, \u201canother issue.\u201d<\/p>\n

FAQ<\/h2>\n